California has been blessed with above normal rainfall this winter, ending the 2007-2009 drought. With reservoirs full and spilling this spring and concern about potential floods, it is easy to forget that California is a semi-arid region, susceptible to drought such as the one that just ended.

But what if the past few years had been a harbinger of an extreme drought lasting for decades? In the past 1,200 years, California had two droughts lasting 120-200 years. Could the state’s water resources continue to supply enough water to drink, grow crops, and provide habitat for fish with such an extreme, prolonged drought?

In many ways, with careful management, California’s economy could withstand such a severe drought. That’s not to say that some ecosystems and local communities wouldn’t suffer catastrophic effects.

We created a synthetic drought similar in scale to the two extreme droughts found in California’s geological and biological records in the past 1,200 years (Harou, et al. 2010). To create such an extreme drought, we looked at the annual streamflows of the two historic mega droughts—having about 40 to 60 percent of historical flows—and created a virtual 72-year-long drought with streamflow at 50 percent of current average rates, with all years being dry, as seen in the paleo-drought record.

This simulated extreme drought was then explored using a computer model of California water management that suggests ways to minimize the economic costs of water scarcity for populations and land use in the year 2020.

Not surprisingly, the model results showed that such an extreme drought would severely burden agricultural and environmental water users and be catastrophic to some ecosystems and agricultural communities. The greatest impacts would be felt in the Central Valley. However, if well managed, the drought would cause surprisingly little damage to California’s economy overall, with a statewide cost of only a few billion dollars per year, out of California’s $1.7 trillion annual economy.

The key to surviving such a drought lies in using adaptive strategies such as water trading and other forms of water reallocation. These strategies would be essential to improving the flexibility of California’s water supply and demand system during such an extreme drought.

Interestingly, given the length of the drought, most existing reservoirs never fill, for decades, so expanded surface storage capacity would be futile for this form of climate change.

But regardless of all the debates over how best to manage California water—for the benefit of people, farmers and fish—the state has a very flexible water supply system that can support a large population and economy under extreme adverse circumstances, providing it is well managed.